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Changing Channels

Posted: February 20, 2007

page 4 of 5

Even among these boutiques and brand stores, the indie boutique stands out as an area of growth. “We provide exclusivity and brands that are unique to customers looking for something other than the big brands,” said Bridget Lescher, owner of Odalisque Beauty Apothecary in suburban Chicago. “It’s the beginning of a trend. People are tired of the impersonal mall experience. We provide an intense one-on-one shopping experience.”

These stores also provide a regional flair and nontraditional brands to consumers. “People are boxed in, so I try to make shopping a journey, heighten the escape factor,” said Lescher. These consumers are not interested in a quick sale, but an experience, and they are willing to spend the time and money to achieve it. For some consumers, however, the shopping experience is not as critical as the ease-of-use and interactive quality offered by the Internet. These consumers are a driving force behind e-commerce.

A Key to Growth
E-commerce is a growing retail trend as consumers shop with just the click of a button. Younger consumers are a target audience for e-commerce, particularly as their spending power increases. Online retailing sites are prime destinations for women 18 to 34. While this demographic is 15.7% of all Internet users, it represents 24% of shoppers at fragrance and cosmetic sites, according to comScore Media Matrix, a research firm.

“The Internet will continue to grow as an information resource as well as an easy means of product replenishment for consumers who know which product they want to buy,” said Setzfand. “Since most consumers want to touch a new product before purchasing it, particularly in skin care and color cosmetics, newer brands may find it hard to get noticed without pre-established awareness,” cautions Setzfand.

Brands can leverage the Internet to increase sales by combining various distribution channels, such as boutiques and shopping networks, with a Web site. Various Web sites also offer message boards and the ability to review products, creating an interactive community for their consumers. Brands and retailers must add value to their Web sites, as online consumers come to expect an interactive experience while online. (See “Web 2.0 and the Cosmetic Industry” on page 42.)